kaperoni: Today’s chat is about this past weekends Imf and World Bank meetings which included Iraq.

kaperoni: Both of these organizations are no-nonsense. After watching several of the videos released, they expect these countries to implement the action plans they sign off on without delay. That being said, lets take a look at the recent Republic of Iraq Financial Sector Review.

kaperoni: I am going to quote from the Quick Notes…

kaperoni: The first paragraph says it all…

kaperoni: “The link between sound and well-developed financial systems and economic growth is fundamental. Efficient and prudent allocation of resources by the financial system is critical for increasing productivity, boosting economic development, enhancing equality of opportunity, and reducing poverty.”

kaperoni: “there are concerns that banks may be weaker than they appear.”

kaperoni: Which Imo is good for us…as an Rv should and will help them.

kaperoni: Another comment…

kaperoni: “most banks appear to be well capitalized,”

kaperoni: That seems to imply that the banks have lots of dinar on hand

kaperoni: . I can only assume the new smaller bills once the Rv takes place.

kaperoni: Now the next quote is directly stated towards the financial system..

kaperoni: “weak financial infrastructure is a clear impediment to access to finance in Iraq.”

kaperoni: This confirms that is very difficult to get your profits our of iraq if you’re an investor. Which of course does include the dinar exchange rate.

kaperoni: Another quote…

kaperoni: “improving accounting and auditing skills and eventually moving to international standards are particularly important.”

kaperoni: And another…

kaperoni: This is a good one...

kaperoni: “The authorities must also undertake a concerted effort to improve the business environment and to strengthen the real economy.”

kaperoni: One can wonder how is that possible without the revaluation?

kaperoni: Now the next part if key, and I think goes to the reforms and pending revaluation…

kaperoni: The supervision of the banks…

kaperoni: “A full expert-assisted self-assessment of the supervisory system, based on the Basel Core Principles and the 2006 assessment methodology, is required to further align the system to international standards.”

kaperoni: And this next one is good…

kaperoni: “there are three prerequisites for the cbi to be able to fully deploy effective supervision: (i) ensuring the political will to let the Cbi perform its tasks without interference,”

kaperoni: That is a direct shot at Maliki to butt out!

kaperoni: And lastly from this summation, they state…

kaperoni: “politically supported, robust, concerted efforts must be made to prevent abuse and undermining of the financial system through corruption, money laundering and the potential financing of terrorism.”

kaperoni: Now from the Wb press release they state it pretty clear…kaperoni: “The report stresses the critical importance of the financial sector in modernizing the Iraqi economy and allowing it to reach its full potential.”

kaperoni: And this one…

kaperoni: “this is a fairly large agenda but ongoing reforms will facilitate the move forward with the Banking Sector Reform Strategy initiated by the Iraqi government in 2009,”

kaperoni: To summarize these two documents….

kaperoni: The Cbi has been told to implement international regulations, international standards, international practices, etc. They have been told to implement there public information campaign..which clearly we are reading about almost daily at this point in regard to the banks, the value and the new notes. They have stated clearly…goi stay out of the Cbi business.

kaperoni: They conclude their recommendations by stating…

kaperoni: “create a clear mechanism and obvious instructions for the transition of the Iraqi economy from the centralized economy to a market-oriented economy.”

kaperoni: Do you all see that?

kaperoni: Wow that is good stuff!

kaperoni: Now, to go back to my first comments…the Imf, the World Banks are results oriented. With the current reforms/action plan in place, you can see there is a strong drive to finish this plan.

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